Posted at 31 October 2022 / Categories Market Roundups
Market Roundup
•US Oct Chicago PMI 45.2 , 47.0 forecast, 45.7 previous
•French 12-Month BTF Auction 2.145% ,2.166% previous
•French 3-Month BTF Auction 1.330% ,1.000% previous
•French 6-Month BTF Auction 1.680%, 1.579% previous
•US Oct Dallas Fed Mfg Business Index -19.4 ,-17.2 previous
Looking Ahead - Economic Data (GMT )
•00:30 Japan Oct Manufacturing PMI 50.7 forecast, 50.7 previous
•01:45 China Oct Caixin Manufacturing PMI 49.0 forecast, 48.1 previous
•03:30 Australia Nov RBA Interest Rate Decision 2.85% forecast, 2.60% previous
Looking Ahead - Events, Other Releases (GMT)
•03:30 Australia RBA Rate Statement
Currency Summaries
EUR/USD The euro dipped against the dollar on Monday as weak Eurozone economic data weighed on euro. Gross domestic product figures published on Monday by Eurostat confirmed eurozone growth slowed in the third quarter, rising 0.2 per cent from the previous quarter. The figure was in line with expectations, but marked a slowdown from growth of 0.8 per cent in the previous quarter.Inflation in the 19 countries sharing the euro accelerated to 10.7% in October from 9.9% a month earlier according to Eurostat data, beating expectations. Immediate resistance can be seen at 1.0000(Psychological level), an upside break can trigger rise towards 1.0087(38.2%fib).On the downside, immediate support is seen at 0.9905 (23.6%fib), a break below could take the pair towards 0.9881 (11DMA).
GBP/USD: Sterling fell on Monday, but was still headed for its largest monthly gain in over a year after the turbulence in British politics over the last few weeks finally appeared to subside. The pound ,which hit a record low of $1.0327 against the dollar in late September, has risen by 3.5% in October, the biggest one-month gain since July 2020, when it rose by 5.5%.Since September's all-time low, it's regained 11% in value. The Bank of England is likely to raise interest rates by another 75 basis points when it meets later this week. The pound was last down 0.6% against the dollar at $1.1545. Immediate resistance can be seen at 1.1612 (38.2%fib), an upside break can trigger rise towards 1.1684 (Higher BB).On the downside, immediate support is seen at 1.1430(50%fib), a break below could take the pair towards 1.1367(11DMA).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday as investors used the final day of the month to adjust the composition of their portfolios and braced for another supersized interest rate hike by the Federal Reserve.The loonie was trading 0.3% lower at 1.3635 to the greenback, or 73.34 U.S. cents, after touching its weakest level since last Tuesday at 1.3685. For the month, it was up 1.4%. The Fed is expected to deliver another 75-basis-point rate hike when its two-day meeting concludes on Wednesday.Last Wednesday, the Bank of Canada downshifted the pace of its policy tightening, hiking the benchmark rate by half a percentage point to 3.75% rather than by another 75 basis points. Immediate resistance can be seen at 1.3664(Higher Bollinger Band), an upside break can trigger rise towards 1.3777 (24th Oct high).On the downside, immediate support is seen at 1.3587(5DMA), a break below could take the pair towards 1.3486(38.2%fib).
USD/JPY: The dollar strengthened against the yen on Monday as dollar was bolstered by expectations of another supersized rate increase at this week's Federal Reserve monetary policy meeting.. The Fed is widely expected to raise its benchmark overnight interest rate by 75 basis points (bps) to a range of 3.75% to 4.00%, its fourth such increase in a row. But for the December meeting, fed funds futures have priced in on Monday a 55% chance of a 50-bps rate increase, down from about 67% last Friday. The dollar rose 0.8% against the struggling yen to 148.68 yen . For the month of October, the dollar was up 2.7%, on track to post its third monthly gain versus the Japanese currency. Strong resistance can be seen at 149.36 (23.6%fib), an upside break can trigger rise towards 150.55 (Higher BB).On the downside, immediate support is seen at 147.61 (5DMA), a break below could take the pair towards 14676(38.2%fib).
Equities Recap
European markets closed mostly higher on Monday with investors looking to pick up stocks despite weak data on inflation and GDP.
The UK's benchmark FTSE 100 closed down by 0.66 percent, Germany's Dax ended up by 0.08 percent, and France’s CAC finished the day down by 0.10 percent.
U.S. stocks lost ground on Monday, with the major indexes closing out a strong month of gains on a weaker foot, as investor focus turned to the Federal Reserve's policy meeting this week.
Dow Jones closed down by 0.39 percent, S&P 500 ended down by 0.75 percent, Nasdaq finished the day down by 1.03 percent.
Treasuries Recap
Treasury yields edged higher on Monday as a relatively strong U.S. economy and labor market suggested the Federal Reserve will stay the course this week and aggressively raise interest rates again to tame inflation.
The yield on two-year notes , which typically moves in step with rate expectations, was up 8.1 basis points at 4.503% while the 10-year US10YT=RR yield rose 7.1 basis points to 4.081%.
Commodities Recap
Gold edged lower on Monday and was heading for its longest streak of monthly losses on record as a stronger dollar, elevated U.S. bond yields and prospects for more rate hikes from the Federal Reserve dented the non-yielding metal’s appeal.
Spot gold fell 0.2% to $1,638.84 per ounce by 11:51 a.m. ET (1551 GMT), and was set to post its seventh straight monthly decline, down about 1.1% this month.U.S. gold futures fell 0.3% to $1,640.60.
Oil prices fell on Monday on expectations that U.S. production could rise and as weaker economic data out of China and the country's widening COVID-19 curbs weighed on demand.
Global benchmark Brent crude futures dropped 94 cents, or 0.98%, to $94.83 a barrel. U.S. West Texas Intermediate (WTI) crude fell $1.37 to $86.53 a barrel, a 1.6% loss.